ENSERVCO Reports First Quarter 2017 Financial Results
(firmenpresse) - DENVER, CO -- (Marketwired) -- 05/11/17 -- ENSERVCO (NYSE MKT: ENSV)
ENSERVCO Corporation (NYSE MKT: ENSV), a diversified national provider of well-site services to the domestic onshore conventional and unconventional oil and gas industries, today reported improved financial results for its first quarter ended March 31, 2017.
"We are pleased to announce solid year over year growth in revenue and adjusted EBITDA in the first quarter," said Ian Dickinson, CEO. "After two difficult years for our industry, we are off to a strong start in 2017, which we expect to be a rebound year for ENSERVCO as industry activity continues to pick up and the investments we made in our business before and during the downturn yield increasingly positive results.
"The first quarter was highlighted by 66% year over year growth in revenue -- to $13.8 million from $8.3 million -- due to a combination of increased customer demand for our core well enhancement services and particularly strong demand for our new water transfer service, which we are now integrating with our frac water heating services to offer customers more convenience in procurement," Dickinson said. "Adjusted EBITDA grew 281% year over year to $2.5 million from $661,000 based on higher revenue that more than offset our fixed costs. We generated a gross profit in our two core service segments in the first quarter, including a $3.5 million gross profit in well enhancement services and a $76,000 gross profit in our new water transfer segment.
"We''re encouraged by our return to profitable growth in the first quarter and optimistic about carrying this momentum into the typically slower second and third quarters. In addition to strength in our traditional operating areas and business segments, we see good opportunities for growth in our new Permian Basin expansion area and are moving forward with the introduction of our water transfer service into the Marcellus Shale. We are also aggressively working on plans to refinance our debt, strengthen our sales and marketing efforts in order to increase market share, and are looking for ways to operate more efficiently."
Total first quarter revenue increased 66% to $13.8 million from $8.3 million last year due primarily to increased drilling and completion activity by E&Ps and growth in the Company''s new water transfer segment.
Well enhancement services revenue grew 67% to $12.0 million from $7.2 million in the first quarter last year and 140% from $5.0 million in the fourth quarter of 2016. This segment included $8.2 million in frac water heating, up 104% year over year; $3.3 million in hot oiling, up 12%; and $466,000 in acidizing, up 272% due primarily to the Company''s move into the Eagle Ford basin and an overall increase in well maintenance activity. Gross profit in the well enhancement service segment increased to $3.5 million from $2.2 million year over year.
Combined Eagle Ford hot oiling and acidizing revenue increased 61% in the first quarter to $1.4 million from $867,000 year over year.
Water transfer services, a new business line for ENSERVCO that was introduced in 2016, grew 393% to $752,000 from $153,000 in the fourth quarter of 2016. The Company began integrating water transfer with its frac water heating service in 2016 and expects this segment to continue growing in 2017. The water transfer business generated a $76,000 gross profit in the first quarter.
Water hauling revenue was $885,000 in the first quarter, down from $1.1 million a year ago due to the Company''s decision to de-emphasize this lower margin service line in order to focus on core and more promising new business lines. Water hauling had a $28,000 gross loss in the first quarter as rain disrupted service activities in Central US region during January and February.
Construction services, also a new offering for ENSERVCO in 2016, generated $154,000 in revenue in the first quarter, down from $599,000 in Q4 last year when the Company substantially concluded a large dirt hauling contract.
Total operating expenses increased 36% year over year to $13.0 million from $9.6 million as direct costs of performing services in core segments increased in conjunction with higher revenue. General and administrative expenses declined slightly to $995,000 from $1.0 million due primarily to headcount reductions. Costs associated with patent litigation and defense increased slightly to $43,000 from $36,000. Depreciation and amortization expense decreased 10% to $1.6 million from $1.7 million.
The Company reported net income of $50,000, or less than one cent per diluted share, in the first quarter versus a net loss of $1.1 million, or $0.03 per diluted share, in the same quarter last year.
Adjusted EBITDA in the first quarter increased 281% to $2.5 million from $661,000 in the same quarter last year.
Management will hold a conference call today to discuss these results. The call will begin at 11:00 a.m. Mountain Time (1:00 p.m. Eastern) and will be accessible by dialing 877-407-8031 (201-689-8031 for international callers). No passcode is necessary. A telephonic replay will be available through May 18, 2017, by calling 877-481-4010 (919-882-2331 for international callers) and entering the Conference ID #10363. To listen to the webcast, participants should go to the ENSERVCO website at and link to the "Investors" page at least 15 minutes early to register and download any necessary audio software. A replay of the webcast will be available for 90 days. The webcast also is available at the following link:
Through its various operating subsidiaries, ENSERVCO provides a wide range of oilfield services, including hot oiling, acidizing, frac water heating, water transfer, bacteria and scaling treatment, water hauling and oilfield support equipment rental. The Company has a broad geographic footprint covering seven major domestic oil and gas basins and serves customers in Colorado, Kansas, Montana, New Mexico, North Dakota, Oklahoma, Pennsylvania, Ohio, Texas, Wyoming and West Virginia. Additional information is available at
This press release and the accompanying tables include a discussion of EBITDA and Adjusted EBITDA, which are non-GAAP financial measures provided as a complement to the results provided in accordance with generally accepted accounting principles ("GAAP"). The term "EBITDA" refers to a financial measure that we define as earnings (net income or loss) plus or minus net interest plus taxes, depreciation and amortization. Adjusted EBITDA excludes from EBITDA stock-based compensation and, when appropriate, other items that management does not utilize in assessing ENSERVCO''s operating performance (as further described in the attached financial schedules). None of these non-GAAP financial measures are recognized terms under GAAP and do not purport to be an alternative to net income as an indicator of operating performance or any other GAAP measure. We have reconciled Adjusted EBITDA to GAAP net income in the Consolidated Statements of Operations table at the end of this release. We intend to continue to provide these non-GAAP financial measures as part of our future earnings discussions and, therefore, the inclusion of these non-GAAP financial measures will provide consistency in our financial reporting.
This news release contains information that is "forward-looking" in that it describes events and conditions ENSERVCO reasonably expects to occur in the future. Expectations for the future performance of ENSERVCO are dependent upon a number of factors, and there can be no assurance that ENSERVCO will achieve the results as contemplated herein. Certain statements contained in this release using the terms "may," "expects to," and other terms denoting future possibilities, are forward-looking statements. The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks, which are beyond ENSERVCO''s ability to predict, or control and which may cause actual results to differ materially from the projections or estimates contained herein. Among these risks are those set forth in ENSERVCO''s annual report on Form 10-K for the year ended December 31, 2016, and subsequently filed documents with the SEC. Forward looking statements in this news release that are subject to risk include expectations for improved financial results in the second and third quarters of 2017; expectations for industry activity to continue picking up and for 2017 to be a rebound year; expectations for investments to yield positive results; expectations for growth in the Permian Basin and expansion of the water transfer business into the Marcellus; and expectations for refinancing debt. It is important that each person reviewing this release understand the significant risks attendant to the operations of ENSERVCO. ENSERVCO disclaims any obligation to update any forward-looking statement made herein.
Contact:
Jay Pfeiffer
Pfeiffer High Investor Relations, Inc.
Phone: 303-393-7044
Email:
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Datum: 11.05.2017 - 05:00 Uhr
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